Shippers say Sierra Leone iron ore transport risky

LONDON/FREETOWN (Reuters) - High moisture content is making the transport of iron ore from Sierra Leone unsafe, causing extensive loading delays and could raise shipping costs for miners operating in the country, industry sources said.

Stockpiles of iron ore at the Rio Tinto Parker Point ship loading terminal in the Pilbara region of West Australia is seen in this handout photograph obtained February 11, 2010. REUTERS/Rio Tinto/Handout

African Minerals and London Mining are the only two iron ore miners operating in the West African country, which has tried to boost output, 10 years after the end of a civil war which left some 50,000 dead.

Ship insurer the London P&I Club said vessels were being offered for loading in Sierra Leone, but it described the cargo as unsafe due to high moisture content which could lead to liquefaction of the mineral.

Liquefaction has, in some instances, resulted in ships becoming unstable and led to them capsizing and sinking.

Limited local expertise and technology, together with poor communications, are exacerbating the problem, the insurer said.

“West Africa is affected by rainy seasons and there is a lot of moisture around. People are very sensitive when it comes to any bulk cargo with high moisture. Safety is paramount and shipping companies can’t take chances with people’s lives,” an industry source with knowledge of the situation added.

“This is potentially very serious for the miners. If ship owners won’t load product, that’s a critical concern for producers. They will have to at least pay more to transport cargoes because less people are available to take it, if they find somebody available to take it at all.”

Although both shippers in Sierra Leone, were aware of their obligations under an international code and appeared to be trying to avoid offering cargo that was wet or with inadequate certification, the London Club said it expected some difficulties to persist, particularly as both shippers plan to increase their export volumes.

Intercargo, an international trade association representing the interests of more than 160 dry cargo ship owners and operators, also said the problem of cargo liquefaction was high on its agenda.

“The issue in West Africa is that a lot of the mines there have been closed due to political reasons. They are starting to open up again but they have been out of the safety and technical loop for all the years they have been closed. We will be keeping a very close eye on developments happening there,” an Intercargo official said.

“If there are any reports of liquefaction, we will be doing our utmost to work with the relevant authorities in countries that are responsible for safety in that region.”

A spokesman for African Minerals said the company is currently shipping both Group A cargoes (capable of liquefying) and Group C cargoes (certified incapable of liquefaction), but has previously halted, and will continue to halt, the loading of product if it cannot meet the required safety specifications.

The firm, which started to ship iron ore about a year ago, also said with the ramp up of the new wet processing plant at its Tonkolili mine it is not envisaging having these problems in the future.

A spokeswoman for London Mining said moisture levels for concentrate at its Marampa mine have typically ranged well below the Transportable Moisture Limit as required by the International Maritime Organization’s Solid Bulk Cargoes code.

The miner said it has to date successfully exported more than 900,000 wet metric tonnes of iron ore sinter concentrate and none of London Mining’s cargo shipments have been rejected.